Can a Planning Permit grant a right and is it inconsistent with the Owners Corporations Rules?
This is a very tricky question and Owners Corporations should all familiarise themselves with the recent decision of the Victorian Supreme Court of Appeal in the matter of Elwick 9 Pty Ltd (ACN 610 147 290) t/as Round Elsternwick v Elliott Freeman, Li Sun and Heather Shearer  VSC 234.
This matter came on appeal from a decision of Victorian Civil and Administrative Tribunal (VCAT). The substance of the dispute was as follows:
The initial applicants, Elliott Freeman, Li Sun and Heather Shearer are residents in the premises of a mixed use commercial and residential apartment block in Glen Eira. Dr. Freeman made an application to VCAT alleging that the gym operator located on the ground floor of the apartment block was breaching the Rules of the Owners Corporation by operating the gym from 6 am and creating noise. Relevantly, the cited Rule stated as follows:
A member must not and must ensure that the Occupier of a Member’s Lot does not:
(a) Make or permit to be made any undue noise in or about the Common Property or any Lot affected by the Owners Corporation;
(b) Make or permit to be made noise from music, machinery or other, including social gatherings, musical instruments, television sets, radios, stereos, CD players or the like which may be heard outside the owner’s Lot between the hours of 10:00 pm and 8:00 am.
(c) Create upon the Member Lot any noise likely to be objected to or which would be likely to interfere with the peaceful enjoyment of the Proprietor or Occupier of another Lot of any person lawfully using Common Property.
The Planning Permit obtained by the gym operator in 2015 had a number of conditions, and in relation to protecting the amenity against the noise the Permit said:
2. No amplified music may be audible outside the building between the hours of 7 pm and 9 am, 7 days a week to the satisfaction of the Responsible Authority.
7. The use must operate only between the following hours:
6 am – 11 am Monday to Friday
3 pm – 8 pm Monday to Friday
7 am – 12 pm Saturday.
VCAT held that the gym operator had to comply with the Owners Corporation Rules in respect to the noise. It made orders that restricted the operation of the gym by directing Elwick 9 Pty Ltd to commence operation of the gym no earlier than 8 am. It also stated that the residents can return to the Tribunal to seek further orders. The gym operator complied however, suffered financial loss due to the restriction. It appealed to the Supreme Court of Appeal asking for an order to revert to the previously allowed opening hours.
The Appeal Court had to consider whether the Tribunal’s decision was in accordance with Section 140 of the Owners Corporations Act and how that section corresponds with a permit condition under the Planning and Environment Act.
The Court held that:
(1) The planning permit has allowed Elwick 9 Pty Ltd to conduct gym business on the premises;
(2) The activities complained of, which were the cause of the noise and vibration, are consistent with the operation of a gym;
(3) One cannot expect any gym to be operating in silence;
(4) Section 140 of the Owners Corporations Act states that the Owners Corporation Rules are of no effect if it inconsistent with any right that is granted by any other Act or Regulation.
(5) The Planning Permit issued by the Responsible Authority granted a right to the gym operator and the Owners Corporation Rules were inconsistent with that right.
It is imperative therefore, for all Owners Corporation Committees that administer a mixed use dwelling, to examine their Owners Corporation Rules to ensure that they do not contradict any Planning Permit Condition/s related to such mixed use.
For more information or to seek legal advice regarding an Owners Corporation matter, please telephone us at 9555 7233 or email us at firstname.lastname@example.org.
This article provides information that is general in nature and is not a substitute for legal advice.